How might the One Big, Beautiful Bill affect individual market health insurance?

In late May, the House of Representatives narrowly approved its version of the One Big, Beautiful Bill Act, a sweeping proposal that could significantly reshape health insurance —especially the individual market.   

The bill is now in the Senate, where changes are likely before a final version can be signed into law. While the path ahead is uncertain, the President has indicated a goal to finalize legislation by July 4. 

Here’s a quick overview of the changes that could impact individual health insurance: 

Medicare 

The bill includes minor Medicare updates that aren’t expected to disrupt the stable and popular Medicare Advantage, Part D, or Medigap plans. Bipartisan support remains strong for these programs. 

The Affordable Care Act (ACA)

ACA-related provisions are more consequential. 

What’s in the House bill?   

• New rules tightening eligibility for Premium Tax Credits (PTCs), which help offset plan premiums.   

• An earlier end to the annual open enrollment period – December 15 instead of January 15.  

These changes could reduce enrollment and lower federal PTC spending. 

What’s missing?   

• The enhanced PTC subsidies introduced under the Biden administration, which fueled significant enrollment growth, would expire after 2025.   

• If the more generous PTC formula is not extended, enrollees may see steep premium hikes in 2026, potentially prompting enrollment declines and insurer exits. (Aetna has already announced plans to leave the ACA market in 2026.) 

Health Savings Accounts (HSAs) 

The bill would significantly expand HSAs:  

• Higher contribution limits 

• Broader eligibility 

• Expanded usage of funds   

Notably, all ACA Bronze and Catastrophic plans would qualify as HSA-compatible. Additionally, active employees over age 65 enrolled in Medicare Part A could continue contributing to an HSA if still working and enrolled in an employer plan. 

Individual Coverage Health Reimbursement Arrangement (ICHRA) 

The House bill will formally codify ICHRAs — first created via a 2017 Executive Order – and rename the program CHOICE (Custom Health Option and Individual Care Expense). 

CHOICE allows employers to exit traditional group health plans and instead fund a tax-free HRA that employees use to buy ACA coverage. This model reduces employer risk and administrative complexity, while giving employees more plan choice. If passed, this change could accelerate ICHRA adoption, especially among mid-sized and large employers.   

What’s next? 

The Senate is expected to introduce its own version of the bill in the coming weeks. We’ll continue to track progress and share updates as this landmark legislation evolves.